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You are here: Home / Computing / Oracle Sees Gray in Cloud Business
Oracle Cloud Business Future Still Murky and Gray
Oracle Cloud Business Future Still Murky and Gray
By Rex Crum Like this on Facebook Tweet this Link thison Linkedin Link this on Google Plus
The jury is still out on Oracle's big push into cloud-based software and services. But Oracle allayed some fears about the state of its cloud software efforts on Thursday [Dec. 14], when it reported cloud-based revenue of $1.5 billion during its fiscal second quarter, which ended November.

That figure was 44 percent higher than the $1.05 billion in cloud sales that Oracle reported in the same period a year ago, and topped the company's own forecast for cloud sales to rise between 39 percent and 43 percent.

However, Oracle's shares fell as much as 4.5 percent to $47.93 in after-hours trading because its cloud sales missed the $1.56 billion forecast by Wall Street analysts.

That reception took some of the shine off of the rest of Oracle's quarterly report. The company earned 70 cents a share, excluding one-time items, on revenue of $9.62 billion. During last year's second quarter, Oracle earned 61 cents a share, on $9.04 billion in sales. Wall Street analysts had forecast Oracle to earn 68 cents a share on revenue of $9.57 billion.

Oracle Chairman and Chief Technology Officer Larry Ellison used the company's results to take a dig at rival Amazon, and its popular Amazon Web Services.

In a statement, Ellison reiterated that Oracle will soon deliver what he said will be the world's first "self-driving," fully autonomous database that will require no human effort for upgrades and product administration. Ellison said the Oracle Autonomous Database would cost "less than half the cost of running a database in the Amazon Cloud."

Oracle's results came as the company continues to shift its business more toward cloud-based subscriptions and away from its long-time reliance on software sales and revenue from product support and licenses.

Speaking on a conference call to discuss Oracle's results, Co-Chief Executive Safra Catz said that for Oracle's third quarter, it expects cloud revenue to rise 21 percent to 25 percent from the $1.2 billion it reported a year ago, and total revenue to climb 2 percent to 4 percent over last-year's sales of $9.2 billion. Catz also said Oracle estimates its earnings, excluding one-time items, will be between 68 cents and 70 cents a share, compared to the 69 cents a share the company reported in the same period a year ago.

Editor's Update: Doubling down on its cloud investment strategy, Oracle yesterday [Dec. 18] announced its $1.2 billion acquisition of Aconex, an Australian company that provides cloud software for construction project management.

© 2018 San Jose Mercury News under contract with NewsEdge/Acquire Media. All rights reserved.
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